Vietnam Coffee Said to Be Trading at Discount on Record Harvest
August 31, 2011, 4:53 AM EDTBy Isis Almeida
Aug. 31 (Bloomberg) -- Buyers are demanding a discount for Vietnam’s coffee crop starting in October on speculation of record output, according to three people involved in the trade.
The beans are trading at $70 to $90 a metric ton below the price on the NYSE Liffe exchange in London, according to the people, who declined to be identified because they aren’t authorized to speak to the media. Robusta beans from the current crop are trading at a premium of $80 to $100 a ton over the London price, traders said.
“Vietnam will have a record 22 million bags production next season, with good weather and farmers flush with cash for inputs maximizing production,” said Keith Flury, an analyst at Rabobank International in London.
Vietnam will produce 19.6 million bags in the current season that ends Sept. 30, according to Rabobank. Global robusta output for 2011-12 will climb 3.4 percent to a record 56.55 million bags, the bank said in a monthly report on Aug. 26.
Robusta coffee for September delivery fell $10, or 0.4 percent, to $2,352 a ton on NYSE Liffe in London yesterday. Prices have climbed 43 percent in the past year.
--Editors: Claudia Carpenter, Sharon Lindores
To contact the reporter on this story: Isis Almeida in London at Ialmeida3@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at Ccarpenter2@bloomberg.net.
